Credit: Reuters/Jonathan Ernst
U.S. Federal Reserve Chair Janet Yellen (L) and Treasury Secretary Jack Lew (R) confer after a meeting of the Financial Stability Oversight Council at the Treasury Department in Washington October 6, 2014.
'The concern was raised that the reference to 'considerable time' in the current forward guidance could be misunderstood as a commitment rather than as data dependent,' said the minutes of the Fed's Sept. 16-17 meeting, which were released on Wednesday.
In its Sept. 17 statement, the Fed's policy-setting committee repeated its assurance that rates would stay ultra-low for a 'considerable time' after a bond-buying stimulus program ends, a pledge it has kept in place since March.
The extent of the debate present in the minutes suggests the committee could move as soon as its upcoming meeting on Oct. 28-29 to change its description of when it may begin to lift rates. It has held benchmark overnight borrowing costs near zero since December 2008.
The minutes also showed signs officials are concerned about the impact the strengthening U.S. dollar could have on the economy.
A 'couple' of meeting participants noted the possibility that longer-term inflation expectations might be slightly lower than the committee's objective, the minutes said.
'Or that domestic inflation might be held down by persistent disinflation among U.S. trading partners and further appreciation of the dollar,' they added.
(Reporting by Michael Flaherty and Jonathan Spicer; Editing by Tim Ahmann)
Posted by Unknown on Wednesday, October 8, 2014 - Rating: 4.5
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